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Utah Tax Guide: Competitive Flat 4.55% Rate

Understand Utah's flat income tax, sales tax rates, and property tax obligations for the 2025 tax year.

4.55%
Flat Income Tax Rate
7.19%
Combined Sales Tax
0.58%
Property Tax Rate
#24
Tax Burden Rank

Tax Overview

Utah uses a flat income tax rate of 4.55%, which has been reduced from 4.65% in recent years. The state's income tax is constitutionally earmarked for education, making Utah unique in how it allocates income tax revenue. The flat rate is competitive among western states and has helped attract businesses and remote workers.

Sales tax in Utah has a state rate of 6.1% (comprising a 4.85% base rate plus a 1.25% earmark), with local additions that push the combined rate to about 7.19%. Utah taxes groceries at a reduced state rate of 3%, though local taxes still apply at their full rates. This reduced grocery rate provides some relief for families.

Property taxes in Utah are moderate, with effective rates around 0.58%. The state offers a circuit breaker tax credit for low-income homeowners and renters, as well as additional exemptions for veterans, blind residents, and qualifying disabled individuals. Utah is generally considered a tax-competitive state with a good balance between services and tax burden.

Income Tax

Utah's income tax revenue is constitutionally earmarked for education. The flat rate has been gradually reduced and is competitive among western states.

Flat Tax Rate: 4.55%

Sales Tax

State Rate6.10%
Avg. Local Rate1.09%
Combined Rate7.19%

Property Tax

Effective Rate0.58%
Median Annual Bill$2,049

Key Deductions in Utah

  • ✓Utah taxpayer tax credit (partially offsets tax on non-taxable income)
  • ✓Social Security income tax credit
  • ✓Retirement tax credit for qualifying seniors
  • ✓At-home parent credit for families with young children
  • ✓Utah 529 plan contribution credit (5% of contributions, up to $105.60)
  • ✓Health benefit plan credit for small employers

Filing Information

Filing Deadline: April 15

Tax Authority: Utah State Tax Commission

Phone: (801) 297-2200

Website: https://tax.utah.gov

Frequently Asked Questions

Does Utah tax Social Security benefits?
Utah technically taxes Social Security benefits but provides a tax credit that effectively eliminates or reduces the tax for most recipients. The credit phases out at higher income levels, so high-income retirees may still owe some tax on Social Security.
Are groceries taxed in Utah?
Utah taxes groceries at a reduced state rate of 3%, lower than the standard 6.1% state rate. Local sales taxes still apply at their full rates, so the total tax on groceries is typically 4-5% depending on location.
How does Utah use income tax revenue?
Utah's constitution requires that all income tax revenue be used for education (public and higher education). This means income tax increases directly fund schools, and other state services must be funded through sales tax and other revenue sources.
Is Utah tax-competitive for businesses?
Yes, Utah is consistently ranked as one of the best states for business. The flat 4.55% income tax, relatively low overall tax burden, skilled workforce, and business-friendly regulations attract companies from across the country.

Neighboring State Guides

IdahoWyomingColoradoNew MexicoArizonaNevada

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